Scottish Executive announces export funding boost

The Scottish Executive has announced a £300,000 funding boost to encourage export growth in key European markets, as research reveals that the weak euro is decreasing the threat from cheap red meat imports.

The grant, which was announced by rural affairs secretary Richard Lochhead at QMS’ marketing conference in South Queensferry last week, will fund two new trade development advisers to cover the already established markets in France and the Benelux countries, as well as two export market managers for Germany and the Nordic countries, in a bid to unlock potential in those regions.

Lochhead told delegates that the Scotch label was recognised as a high-quality, premium brand, which put Scotland in a good position to maximise exports into the European market. The EU currently accounts for 90% of Scotland’s red meat exports.

He said: “The current economic landscape in Europe is certainly a very challenging market to operate in. However it’s very encouraging that, despite these difficulties, our beef and lamb export sales grew during 2011 to around £100m.

“But we will not rest on our laurels. That’s why we are providing funding to QMS to support growth in established markets, as well as seeking to increase exports in other EU countries.

“I hope that by taking such positive action through this twin strategy we can continue to ensure that more European consumers are able to enjoy our delicious Scotch Lamb and Scotch Beef in the years to come.”

QMS chairman Jim McLaren said: “In these times of economic uncertainty, it’s very encouraging to see targeted investment by government in areas that have already proven they can deliver strong economic growth for Scotland.

“The refocused export strategies for QMS will not only see our fabulous brands gain an even stronger following on the Continent, but will also contribute significantly to the vital issue of carcase balance, which adds to the efficiency of the Scottish processing sector and adds value to the entire red meat supply chain.”

Meanwhile, analysis from QMS has revealed that the weakness of the euro and increased global meat demand is helping to prevent cheap red meats imports undercut prices. Research on global meat trends said that currency fluctuations outside Europe are making it difficult for importing nations, such as South America and Australasia, to maintain their competitive edge.

Ashworth said: “With the euro in the doldrums, the currencies of our traditional trading partners, such as Brazil and New Zealand, are appreciating strongly, and this, coupled with tight supplies, is leading to global prices converging with European prices.

“Although the market is global, it is concentrated in a few large producers. Australia and Brazil alone account for more than a quarter of the beef trade and, together, New Zealand and Australia cover more than two-thirds of global lamb exports.

“With Australia a major supplier in the Middle East and New Zealand having recently brokered a bilateral free trade agreement with China, it means that although the EU will always be a major customer, there are a number of other countries looking for a bigger share of what is a fairly static supply.

“Aside from potential changes to the CAP and international trade deals, the current range of socio-economic changes happening throughout the world look set to underpin strong prices in the medium- to long-term.”

Tightening global supply coupled with increased demand for meat both at home and abroad has already helped to increase export activity in the UK in recent years.

Studies by the Food and Agriculture Organization of the UN have predicted that demand for beef is set to rise by 58% by 2050, with sheep and goat meat up 78% and demand for pigmeat up by 37%. Most of the growth is expected to be driven by the emerging prosperity in developing countries.